Reclaiming Your Credit Hire Claims Expenses

Expenses Associated with Credit Hire Claims

In Credit Hire claims, the expenses for using the replacement vehicle can vary and often prove to be substantial. The receiving party must disclose these costs and may need to present expert evidence to establish the reasonableness of the hire rate charged by the hire company. Additionally, the Claimant's financial situation is evaluated to ascertain whether they were genuinely unable to afford a replacement vehicle without resorting to Credit Hire, which may lead to lower fees being incurred.

Recoverable Expenses in Credit Hire Claims

In the event of a successful Credit Hire claim, the third-party insurer will be obligated to cover the Claimant’s litigation expenses. Depending on the case particulars and the proceedings of the primary action, these expenses can be awarded under the fixed costs regime outlined in CPR 45 or assessed on a standard basis.

If your Credit Hire claim also involves personal injury, it is probable that it will fall under the fixed costs stipulated in Part 45 of the Civil Procedure Rules. Although the costs are fixed, negotiations for disbursements are possible, necessitating the assistance of Costs Draftsmen to ensure full recovery.

According to Practice Direction 16, paragraphs 6.3 and 6.4, to ensure a successful Credit Hire claim, you must consider the following:

6.3 In the particulars of claim, the Claimant must specify:

(1) The necessity for the replacement vehicle at the pertinent time;

(2) The duration of the claimed hire period (including the start and end dates);

(3) The claimed hire rate;

(4) The reasonableness of both the period and rate of hire; and

(5) Impecuniosity, if the claim pertains to credit hire.

6.4 In paragraph 6.3:

(1) "Pertinent time" refers to the commencement of the hire and throughout the hire period;

(2) The requirement to specify the mentioned matters encompasses the obligation to state pertinent facts.

What Does Credit Hire Entail?

Credit Hire claims typically stem from Road Traffic Accidents and can manifest as an independent claim or as a component of a primary Personal Injury action. In Credit Hire scenarios, the Claimant obtains a substitute vehicle for their use while their own vehicle undergoes repairs due to damage sustained in the accident. This service is availed of when the Claimant lacks the financial means to privately hire a vehicle. Alternatively, if the damage is severe and renders the vehicle irreparable, a replacement vehicle is utilized until funds are recuperated from the third party to replace the vehicle.

Credit Hire Claims entail a credit hire agreement with a credit hire company delineating the hire charges for the duration of the vehicle's usage. The costs accrued under the Credit Hire agreement are typically recovered in the primary action, often from the third-party insurer if they are deemed liable for the accident.

How can we help?

At DMD Costs, we offer comprehensive assistance in recovering your costs for Credit Hire claims. Whether it falls under the fixed costs regime or the standard basis, we can prepare a detailed Bill of Costs on your behalf. Our team is adept at negotiating both costs and disbursements incurred during the case, ensuring the best possible outcome. In instances where the third party disputes the costs, we can assist in issuing Part 8 proceedings for costs, even if the main action has settled pre-issue. We handle disputes to the bill and provide effective replies, ensuring the legal basis for cost recovery is clearly presented before the Court. Additionally, we provide representation at Detailed Assessment through our fully qualified Costs Lawyers.

For particularly complex credit hire claims allocated to the Multi Track, we ensure accurate estimation of costs to Trial by preparing and negotiating a Precedent H Costs Budget, as per the Civil Procedure Rules.

If you require assistance with cost recovery for credit hire claims or any other case, please feel free to contact us via Live Chat, email at info@dmdcosts.co.uk, or by calling one of our specialist Costs Lawyers/Costs Draftsmen at 07503 992804.

If the Credit Hire claim is the sole head of claim in the case or is part of a broader claim for vehicle damages, it will be subject to assessment on the standard basis. The assessment process is governed by Part 47 of the Civil Procedure Rules.

Standard basis costs are those allowed on an hourly rate basis, which must be proportionate and reasonably incurred in relation to the damages recovered, the conduct of the parties throughout the case, and the litigation process.

These costs encompass the preparation of an itemized Bill of Costs accrued during the course of the claim. If the Bill of Costs is not agreed upon through negotiations, it must be served with a Notice of Commencement to initiate detailed assessment. This assessment may be conducted by a Judge at the relevant County Court. The Judge will evaluate the proportionality of the Bill of Costs in relation to the damages recovered and the factors outlined in CPR 44.3(5).

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